LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session April 2, 1997 TO: Honorable Fred M. Bosse, Chair IN RE: House Bill No. 3338 Committee on Land and Resource Management By: Hilbert House Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on HB3338 ( Relating to alternative pleading to condemn.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by HB3338-As Introduced Implementing the provisions of the bill would result in a net impact of $0 to General Revenue Related Funds through the biennium ending August 31, 1999. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill. Fiscal Analysis This bill would allow property owners to recover all expenses, including reasonable and necessary attorney's fees, in cases where it is found that the condemnor does not own an interest in property it has claimed. Methodolgy The Department of Transportation anticipates that this bill would affect the agency most often in certain inverse condemnation situations. The department estimates, based on recent experience, that it would be required to pay attorney's fees and other expenses in 10 inverse condemnation cases per year, each entailing approximately 200 hours of attorney time at $200 per hour. In addition to attorney's fees, the department expects to pay to property owners $15,000 in expenses per case. Such costs would result from appraisal fees, expert witness fee, and other expenses. Each case would therefore cost the department $55,000. The probable fiscal implications of implementing the provisions of the bill during each of the first five years following passage is estimated as follows: Five Year Impact: Fiscal Year Probable Savings/(Cost) from State Highway Fund 0006 1998 ($550,000) 1998 (550,000) 2000 (550,000) 2001 (550,000) 2002 (550,000) Net Impact on General Revenue Related Funds: The probable fiscal implication to General Revenue related funds during each of the first five years is estimated as follows: Fiscal Year Probable Net Postive/(Negative) General Revenue Related Funds Funds 1998 $0 1999 0 2000 0 2001 0 2002 0 Similar annual fiscal implications would continue as long as the provisions of the bill are in effect. This bill's cost to local governments would depend on the number of inverse condemnation cases which would result in an entity paying property owners for expenses. The cost per case to local governments is expected to be similar to that estimated for the Department of Transportation. Source: Agencies: 302 Office of the Attorney General 304 Comptroller of Public Accounts 601 Department of Transportation LBB Staff: JK ,BB ,TL